The document discusses the impacts of India's 2016 demonetization, which removed Rs. 1000 and Rs. 500 banknotes from circulation. Politically, it gained support from educated people and strengthened Prime Minister Modi's BJP party. However, opposition parties criticized the implementation. Socially, it caused issues for weddings and hospitals initially refused old currency. Economically, it aimed to reduce black money and increase transparency, though some felt it did not address foreign holdings. While hurting the poor initially, the long term goals are to move towards a less cash-based economy and use the recovered funds to help the disadvantaged.

1. Dr NINGAPPA.N.ARABAGONDA.Selection Grade Librarian
Dr Suresh.H.N. Assistant Professor in sociology
Prof. P.K.Binnal Assistant Professor in History
Dr S.K.Patil Assistant Professor in Commerece
Govt First Grade College-Byadagi -581106

2. INTRODUCTION
 Demonetization refers to the financial step of the
government to declare a currency unit invalid.
 Usually, this is followed by exchanging the old
currency for new currency. Earlier, demonetization of
1,000, 5,000 and 10,000 rupee notes was done in India
during the rule of Murarji Desai as Prime Minister in
1978.

3. POLITICAL IMPACT
 The political impact of the move is huge across the
whole country with majority of the educated people
offering support to the demonetization. The
sentimental speeches against black money made by
Prime Minister Modi are drawing huge crowds turning
into vote banks for BJP.
 Opposition parties strongly oppose the
demonetization implementation process.

4. SOCIAL IMPACT
 The social impact was drastic with marriages facing severe issues with
cash transactions in marriages coming to a standstill. Currently, People
conducting marriages must produce the marriage invitation to
withdraw 2, 50,000 and above. This has caused great hassles among the
public
 The impact on the health care sector was huge with hospitals refusing
to accept the old currency.
 The impact on education sector was minimal and all universities and
colleges have been instructed to enable online transactions in their
website for the convenience of the students and parents.
 Salaried people faced the issue on the opening day of the month with
their salaries credited in the bank account but were able to withdraw
only 2,000 rupees from the ATM machines.
 Social problems in the form of road blockades and quarrels arouse with
people waiting in long queues before the banks and ATM machines.
People become restless spending an entire day to withdraw money.

5. ECONOMIC IMPACT
 Demonetization is viewed as a measure of sterilizing the money. RBI
plays the pivotal role in this demonetization drive. All the banking
experts welcome this demonetization measure.
 Considering the entire economy of India as a whole, demonetization
will make most of the transactions to be done through the formal
banking sector. This will increase the transparency with people and
corporate paying tax properly
 When black money within India gets curbed, it will result in the
overall economic development of the nation. This was revealed in the
demonetization when terror financing and other sources of illegal
financing was curbed
 Demonetization does not address the black money stashed abroad and
the illegal foreign transactions taking place through the participatory
notes. Corruption, fraudulent practices and broker menace remain
areas of concern in carrying out the mass demonetization in an
efficient manner

6. CONCLUSION
 The impact of demonetization was felt more in the social sector
and the worst affected was also the poor and the common
people. Salaried class is not still able to withdraw their salaries
from the banks and ATMs as a result of cash deficit. Prime
Minister Modi has encouraged doing financial transactions using
mobile and other electronic means. It is clearly evident that
India is moving towards cash less economy. This will curb the
black money to a great extent but educating the masses on the
mobile based money transaction is a huge challenge. Finally as a
relief to poor people, GOI has announced that black money
retrieved from the demonetization measure will be deposited for
four years without interest on Kalyan Yojana to benefit the poor
in marriage. This will create a positive impact on the social sector
in the long run.

7. Thank you